This invention relates to fraud detection, and more particularly, to analyzing and identifying sources of fraud in real time.
Transactions made with payment cards such as credit cards, prepaid cards, debit cards, and smart phones, can be susceptible to fraud. There are many possible types of fraud. In one type of fraud, a phony merchant may initially (dormant period) masquerade as a genuine merchant and then suddenly begin making many fraudulent transactions using all the previous cards that visited that merchant. In other types of fraud, payment cards or account information may be stolen. Fraudulent transactions may occur on the account after the card has visited a root of compromised accounts (acceptor).
Payment card issuers, such as banks and other financial institutions are often motivated to detect and stop fraudulent transactions. The most costly way is when the card issuer learns of the fraudulent transactions only when it is reported by a cardholder. However, there may be a delay between the time a fraudulent transaction occurs and when it is noticed and reported by the cardholder. Meanwhile, the source of fraudulent transaction may continue to compromise that account and other cardholders' accounts.
It would be desirable to provide a way to rapidly stop fraudulent transactions and identify in real-time the root/sources of compromised accounts as well as phony merchants.